Gemini Space Station (GEMI), a digital asset platform, has experienced an approximate 80% decline in its valuation since its initial public offering, which has reignited discussions regarding whether the exchange established by the well-known billionaire Winklevoss brothers could ultimately become an acquisition target.
Lorenzo Valente, who serves as the director of digital assets research at ARK Invest, asserted in a post on X last month that Hyperliquid, an offshore perpetual-trading venue, ought to purchase Gemini and utilize it as a compliant U.S. entry point for prediction markets and perpetual futures, noting that the concentrated voting authority held by the Winklevoss twins might streamline the transaction.
Is Gemini a viable target?
Despite the absence of any signs that Hyperliquid is actively pursuing a buyout of Gemini, Valente’s suggestion brings up a wider question: What intrinsic worth does Gemini offer to an interested buyer if its compliance architecture holds greater value than its diminishing spot-trading operations?
Presently, the market capitalization of the stock sits at $753 million, marking a steep decline from its peak valuation of approximately $4 billion. Gemini’s second-quarter exchange revenue dropped 38% compared to the prior year, reaching $12.5 million, while spot trading activity fell 66% to $3.8 billion, and overall assets on the platform shrank from $18.2 billion down to $8.4 billion.
While its exchange operations are contracting, its foundational exchange technology might also present minimal differentiation from competitors, according to statements made to CoinDesk by a venture capital investor.
Nevertheless, the investor pointed out that Gemini maintains crucial regulatory licenses and certifications through its subsidiaries, which would prove both expensive and time-consuming for rivals to build independently. Prospective buyers would likely balance the expenses of acquiring these corporate entities against the time investments and legal costs tied to securing those authorizations themselves, the individual added.
This scenario aligns with a broader trend across crypto M&A activity, where purchasers increasingly shell out for compliance frameworks, distribution networks, and market entry instead of simply buying transaction volume. For instance, digital-asset provider Keyrock acquired BlockFills’ trading assets back in July to gain regulatory permissions, derivatives expertise, and institutional accounts, whereas tokenization enterprise Ondo has examined a purchase valued as high as $500 million. Furthermore, LMAX along with B2C2 have investigated strategic deals as web3 organizations try to scale through acquisitions rather than developing every single license and offering internally.
CoinDesk reported in April that interested parties were evaluating the acquisition of Gemini’s shuttered European and U.K. divisions primarily to secure their regulatory credentials rather than executing a complete takeover. No agreement has materialized so far due to differing perspectives regarding valuation, noted the investor, who requested anonymity because the discussions are confidential.
Gemini opted not to provide any statements regarding this matter.
Voting control
Another factor involves shareholder governance.
The Winklevoss brothers control a massive 94.5% of the voting rights at Gemini, meaning that any discussions concerning a deal would primarily involve just two individuals, which could potentially streamline the procedure.
Conversely, this creates a major barrier. Because of their dominant voting control, the siblings must greenlight any prospective sale, rendering a hostile takeover attempt or any shareholder-led push to force a transaction virtually impossible.
Even though the drop in value highlights anxieties surrounding contracting trading volumes and persistent financial losses, this depressed valuation could present an interested buyer with a relatively cost-effective pathway to obtain Gemini’s regulatory licenses, user base, and custody architecture.
Ultimately, the key question remains whether prospective buyers can successfully persuade the brothers to agree to a sale.
Originally published at https://www.coindesk.com/business/2026/09/20/gemini-s-stock-is-down-80-from-its-ipo-that-s-reviving-takeover-speculation.
